The great geopolitical interests that are at stake here must not be underestimated and the choices that are made now will have deep and lasting consequences for the future of the European continent. What, exactly, is at stake becomes clear from the comment of the EU Commissioner for Enlargement, Štefan Füle, who said that the “creation of a free trade zone between Ukraine and the European Union, to which Ukraine aspires, is incompatible with Ukrainian membership of the [Russia dominated] Common Economic Area’s customs union.”[27] Anders Åslund, a political analyst, declared that he “does not believe there are any real economic benefits in the customs union for Russia.”[28] Economic benefits were certainly not Putin’s main motivation for launching this project. In the long run also the benefits for the eventual partner countries are restricted—in particular for Ukraine. Putin, however, did his best to minimize the benefits for Ukraine of an association agreement with the EU, saying that “Ukraine sells Europe two litres of milk, [while] the Customs Union brings her 9 billion dollar per year.”[29] One may ask oneself why the customs union—despite its limited economic rationale for Russia—is so important for Moscow. One reason was possibly Russia’s aspiration to become a member of the World Trade Organization. After the Russian invasion and dismemberment of Georgia it was clear that Georgia, which already was a WTO member, would be inclined to block Russian membership. Putin first declared that Russia was no longer interested in becoming a member of the WTO. Later, however, he changed his tactics, and in June 2009 he announced that Russia wanted to join the WTO as a single customs union with Belarus and Kazakhstan. This collective application would make it more difficult for Georgia to block Russia’s WTO membership. But this option had to be dropped because there were too many technical obstacles. Thereupon Moscow declared that the three countries would negotiate individually, but harmonize their positions and enter the WTO together. Putin sought—and got—the support of the United States and the European Union to put pressure on Tbilisi. Things were, however, not so easy. The government of Mikheil Saakashvili said it could accept a Russian WTO membership only if Georgian customs officials would man the border posts in Abkhazia and South Ossetia, a demand that was unacceptable to Moscow because it would mean that the Kremlin would recognize Georgian sovereignty over the two breakaway territories.[30] Finally, in November 2011, a compromise was signed, brokered by the Swiss government. The parties agreed on international monitoring of trade along the mutual borders of Abkhazia and South Ossetia.
WTO membership, however, was not the real reason behind the launch of the customs union. The real reason was political rather than economic. The customs union served the same goal as the other Russian projects in the post-Soviet space, which is to reestablish Russian hegemony over the former Soviet republics. Moscow is ready to pay and does not hesitate to take up its former Soviet-era role when it generously subventioned the economies of the other republics. In the year 2011 the price Moscow was ready to pay for its customs union with Belarus, for instance, amounted to cancelling the customs duties for oil exported to Belarus, which cost the Russian budget about $2 billion.[31] Putin boasted in July 2012 that due to the low energy prices Belarusian GDP was raised with 16 percent.[32] In the meantime Russian officials are busy traveling around in the post-Soviet space, proselytizing and spreading the word. One of the envoys, Georgy Petrov, vice president of the trade-industrial chamber of Russia, went to Yerevan in December 2010 to woo the Armenians. According to an Armenian news agency, “Petrov implied Armenia’s joining the union will be advantageous for the country.”[33]
The CSTO: A Mini-Warsaw Pact?
Another vector used to project Russian power in the post-Soviet space is security cooperation. This was originally organized within the framework of the CIS. Immediately after the demise of the Soviet Union, in May 1992, a Treaty on Collective Security, the “Tashkent Treaty,” was signed. It was Putin, who, in May 2002, took the initiative to transform this platform and make it into a new, separate organization and rename it the Collective Security Treaty Organization (CSTO). Six former Soviet republics became members of this mini-Warsaw Pact: Russia, Belarus, Kazakhstan (the core states that also form the customs union), plus Kyrgyzstan, Tajikistan, and Armenia. Uzbekistan joined in 2006. The member states are not allowed to join other military alliances, and there is a collective security guarantee (article 4), similar to article 5 of the Washington Treaty. Membership is made attractive by Moscow by offering the member states the possibility of buying military equipment in Russia at cost price. With the CSTO Moscow pursued two main objectives:
First, to bind the participating countries in such a way that it would become more difficult to leave the organization.
Second, to declare an exclusive zone of operation from which other security organizations and third countries (meaning: NATO, but implicitly also China) are excluded.
The first objective is pursued by a progressive integration of the command and control functions, including a common air defense, and the formation of a CSTO rapid reaction force. The second goal—to claim for the CSTO an exclusive zone of operation from which other security organizations are excluded—was one of the objectives of President Medvedev’s proposal for a new Pan European security treaty, launched in 2008.[34] Neither NATO, nor the United States, has agreed to grant Moscow via the CSTO such an exclusive droit de regard in the former Soviet space. Moscow, however, will continue its efforts to become the “Gendarme of Eurasia.”[35] That this role for the Kremlin also has its limitations became clear in June 2010, when during the ethnic violence in Kyrgyzstan the Kyrgyz government asked for Russian peacekeepers in the region and Moscow did not respond—notwithstanding the fact that the events took place in a region in which Moscow claims to have “privileged interests.” Apparently the Kremlin knew that peacekeeping in this case would not bring any direct benefits to Russia, but would rather be an ungrateful and costly job. These were not the only problems. After his comeback as president in May 2012, Putin went to Uzbekistan. According to Fyodor Lukyanov this visit was “an attempt to reset relations with this recalcitrant and most unreliable CSTO ally whose position stands in the way of making this organization a working military and political alliance.”[36] Putin’s visit did not help. On June 28, 2012, Uzbekistan, the country that has the most significant armed forces in Central Asia, suddenly suspended its membership of the organization. The reason was the deep mistrust in Tashkent concerning the Russian intentions. These intentions evoke the specter of the infamous Brezhnev doctrine, because they include inter alia “to lower the threshold for intervention within the organization’s region, shift the respective decisionmaking mechanisms from a consensus to a majority rule, and develop a joint task force.”[37] According to the defense specialist Vladimir Socor, Uzbekistan’s departure showed that “this organization is purely symbolic. . . . The CSTO is mainly a symbol of Russia’s aspiration to become a great power and to be regarded as the leader of a bloc.”[38] But also symbolic organizations can bite. On April 11, 2013, Serbia was granted observer status at the Parliamentary Assembly of the CSTO (PA CSTO), showing that the CSTO had a certain attraction for a future EU member state. Afghanistan was equally granted observer status. “This is another confirmation,” said Sergey Naryshkin, president of the Duma and the Parliamentary Assembly of the CSTO, “that the PA CSTO has weight and is taken seriously on the international stage.”[39]
The Shanghai Cooperation Organization:
A Double-Edged Sword?
Another initiative that needs to be mentioned here is the Shanghai Cooperation Organization (SCO). This forum also has its origin in the Yeltsin era. “Steps toward a closer Russian-Chinese relationship were outlined in March 1992 in a policy paper by Yeltsin’s former political advisor, Sergei Stankevich.”[40] It led to the foundation, in 1996, of the Shanghai Five, consisting of Russia, China, Kazakhstan, Kyrgyzstan, and Tajikistan and emerged from the border talks between China and the Soviet successor states. It was—again—Vladimir Putin, who took th
e initiative to expand this organization and give it a more powerful structure. In 2001, when Uzbekistan joined the organization, it got its new name and began to implement many activities, ranging from fighting terrorism and drugs trafficking to economic and cultural cooperation and the organization of joint military exercises. Pakistan, India, and Iran were invited as observers, while the United States was refused observer status. The SCO proudly claimed that—including the observer states—it represented “half of humanity.” The organization has an undeniable anti-US and anti-NATO focus. Used by Putin to project Russia’s power in the region, it is, however, a double-edged sword, and for Moscow it also brings inconveniences. Although it may be instrumental to the Kremlin’s objective of keeping NATO and the United States out of Central Asia, it simultaneously facilitates the Chinese penetration of the Central Asian republics. This penetration has for the moment a predominantly economic character, but it will undoubtedly soon acquire more political dimensions. For this reason two opposition politicians, Boris Nemtsov and Vladimir Milov, severely criticized Putin’s China policy. “It would be more appropriate to call Putin’s policy toward China ‘capitulationist,’” they wrote. “In the years of Putin’s rule the Russian military-industrial complex has, in particular, armed the Chinese army.”[41] In the medium term, and certainly in the long run, the SCO could, indeed, become an asset for Beijing more than for Moscow, and their struggle for influence, markets, and energy, in the countries of Central Asia could soon become a zero-sum game.
BRIC, BIC, BRICS, or BRIICS?
Putin has “made clear that Russia has no intention of joining anybody else’s ‘holy alliances,’” wrote Eugene Rumer.[42] This is, indeed, true. Putin prefers to build his own organizations. He is a staunch organization builder and undertakes initiatives in all possible directions, building organizations when only the slightest oportunity arises. An example is the first BRIC summit convened in Yekaterinburg on June 16, 2009. BRIC is a term coined by Jim O’Neill of Goldman Sachs to indicate the four most important emerging economies in the world: Brazil, Russia, India, and China. It was meant by him only as an investment term and had nothing to do with politics. Putin, however, jumped at the opportunity, seeing another prominent role for Russia in a global forum. The first meeting of the presidents of the BRIC countries immediately exposed their fundamental differences. Two of them, Brazil and India, are democracies. The other two, China and Russia, are non-democratic dictatorships. While the first two are in effect newly emerging powers, the other two are already long-established and recognized powers on the world scene, both being permanent members of the UN Security Council. The four disagree on most issues: human rights, democracy, trade, climate change, and the reform of global governance. The year in which the first BRIC conference took place was also the year in which the term “BRIC”—in itself already an artificial construction—lost the last remnants of its initial meaning of fast-growing emerging economies: while in the crisis year 2009 the other countries continued to grow, Russia’s GDP plunged 7.9 percent—which was the worst performance among the Group of Twenty leading economies. Participants at a business conference in Moscow in February 2010, therefore, ironically, suggested changing the name from BRIC into BIC.[43] This did not prevent the BRIC from organizing its second conference in Brazil’s capital Brasilia in April 2010. Even if Russia, with its inefficient state capitalism, cronyism, and rampant corruption, remained the economic dwarf of the four, the BRIC format offered Moscow an extra forum to project its political influence on the world stage.
However—as is the case in the Shanghai Cooperation Organization—the BRIC was not only a forum for Russia, but equally for China. In December 2010 South Africa became a member and China sent an invitation to South African President Jacob Zuma to participate in the 2011 BRIC summit in China. The aim was to broaden the BRIC into BRICS, this despite the fact that the size of the South African economy is only a quarter of Russia’s and its growth in 2011 would not exceed 3 percent. China especially, which, with South Africa, is the biggest investor on the African continent, seemed to profit from this enlargement of the BRIC.[44] However, during the BRICS summit in the South African town of Durban on March 26 and 27, 2013, President Putin succeeded in forging a closer cooperation with his South African counterpart. Vladimir Putin and Jacob Zuma agreed to create a kind of platinum OPEC,[45] and Putin offered South Africa help with the construction of a nuclear power plant. The two leaders also decided to build a strategic partnership and deepen cooperation in the military sphere, including joint exercises of the armed forces of the two countries. Plans were also announced to set up a joint production of the Ansat light purpose helicopter.[46] The cherry on the cake was a declaration by both countries “not to participate in any treaties and agreements which have an aim to encroach on the independence, sovereignty, territorial integrity or national security interests of the other party,”[47] which can be read as a South African pledge to keep its distance from NATO. Another Russian hope: to build a BRICS development bank that would challenge the hegemony of the Western-dominated IMF and World Bank had to be postponed to the summit of 2014.
There are plans to enlarge the BRICS with other emerging economies. The main candidate is Indonesia. Its accession would transform the BRICS into BRIICS.[48] Another candidate is Turkey. In fact there is a whole series of emerging economies that would qualify for membership. The list of potential new members includes Mexico, Nigeria, South Korea, and Vietnam. However, as Martyn Davies, indicated, “There is a debate within the Brics as to whether to ‘deepen’ or ‘widen’ the grouping. While South Africa and Brazil are keen to expand the number of member countries, China and India prefer to consolidate. Russia is ambivalent.”[49] The Russian ambivalence could be explained by the geopolitical rather than economic importance it ascribes to the grouping. It would certainly welcome an old ally, such as Vietnam, and possibly even Turkey, which is considered by the Kremlin to be an independent and critical NATO member. It would certainly be, however, reluctant to admit a close US ally, such as South Korea. All this cannot conceal the fact that the BRICS remain a highly artificial construct, and this will even be more so when the club expands. Ruchir Sharma wrote:
China apart, they have limited trade ties with one another, and they have few political or foreign policy interests in common. A problem with thinking in acronyms is that once one catches one, it tends to lock analysts into a worldview that may soon be outdated. In recent years, Russia’s economy and stock market have been among the weakest of the emerging markets, dominated by an oil-rich class of billionaires, whose assets equal 20 percent of GDP, by far the largest share held by the superrich in any major economy. Although deeply out of balance, Russia remains a member of the BRICS, if only because the term sounds better with an R.[50]
Notes
1. “Top Kremlin Aide Says Putin Is God’s Gift to Russia,” Reuters, July 8, 2011.
2. Yevgenia Albats, The State within a State: The KGB and Its Hold on Russia: Past, Present, and Future (New York: Farrar-Straus-Giroux, 1994), 325.
3. Former Prime Minister Primakov, for instance, did not hide his disappointment. He wrote that after the war with Georgia in 2008, “Russian society was pained by the silence in the beginning from our CIS allies, and still more by that of the Collective Security Treaty Organization (CSTO). Quite certainly we have overestimated relations within the CIS and the CSTO.” (Evgueni Primakov, Le monde sans la Russie? À quoi conduit la myopie politique, with a preface by Hubert Védrine (Paris: Economica, 2009), 175.)
4. Cf. Janusz Bugajski, Georgian Lessons: Conflicting Russian and Western Interests in the Wider Europe (Washington, DC: Center for Strategic & International Studies, 2010), 19.
5. Dmitry Babich, “Russia-Belarus Union State on Shaky Legs,” RIA Novosti (December 8, 2009).
6. Chubais quoted in Valery Paniouchkine and Mikhaïl Zygar. Gazprom: L’arme de la Russie (Paris: Actes Sud, 2008), 188.
7. Larissa Sayenko, “Kto kogo dushit,” Mos
kovskie Novosti, no. 13 (March 30–April 6, 1997), 8.
8. “Lukashenka at Bay,” The Economist (December 4, 2010).
9. Dmitri Trenin, Post-Imperium: A Eurasian Story (Washington, DC, and Moscow: Carnegie Endowment for International Peace, 2011), 46.
10. Jan Maksymiuk, “Belarus: Lukashenka Eyes Union with Ukraine,” RFE/RL (November 24, 2006).
11. “Putin Named PM of Belarus-Russia Alliance,” msnbc.com (May 27, 2008).
12. “Medvedev Says Belarus Has Not Been Asked to Become Part of Russia,” RIA Novosti (November 23, 2009).
13. “Medvedev Says Belarus Has Not Been Asked to Become Part of Russia.”
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